The offbeat personal finance blog for responsible people.

Treating Your Household Like A Business Isn’t Rocket Science

Anybody can run a household like a business, but to do it effectively you first have to appoint a household CEO in order to get the job done. Of course, the best candidate for running your household is always … you.

For instance, here’s a bit of wisdom that the good folks at the Wharton School of Business will never give to their prospective students: You don’t have to have an MBA to be a successful corporate CEO.

In fact, being a CEO for a Fortune 500 company doesn’t require a college degree — just ask Bill Gates. It may be hard to believe, but I assure you that anybody who is armed with a toolbox of basic principles in hand has most everything they will ever need to handle the job of CEO, whether they are running a Fortune 500 corporation or a household of one.

Think I’m kidding? I’m not. According to USA Today, at the beginning of the 21st century, only one-third of all American CEOs could claim to be a holder of an MBA.

After all, it’s not as if the holder of an MBA can say with any certainty that he or she will make a top-notch CEO. For example, the late Kenneth Lay, infamous ex-CEO of Enron, held an MBA as well as a Ph.D. in economics.

I’m not trying to bash people who hold MBAs. But I am trying to stress that if multi-billion dollar companies can be run by people without all of the studying and training that is required to earn an MBA, then it certainly follows that it doesn’t take a lot of hokey financial theory to be an effective household CEO either.

Why? Because the job of household CEO really only relies on your understanding of a few basic principles, a bit of common sense, and a commitment to becoming financially free — regardless of your household income.

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[…] Part 3 of my State of the Household financial report for 2008. I’ve been very serious about running my household like a business for close to 20 years now. As a result, I have managed to compile detailed data across a long time […]

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